Forgotten US finance figure came from Geneva

The statue of Albert Gallatin stands in Washington zVg EDA

In front of the United States Treasury building in Washington is a statue of Albert Gallatin with the inscription: Genius of Finance.

From the western Swiss city of Geneva he went on to become Secretary of the Treasury under President Thomas Jefferson in 1801, and he remains the longest-serving holder of the office.

Today, he is largely forgotten but a new biography entitled: Gallatin – America’s Swiss Founding Father could help raise public awareness.

The author, Nicholas Dungan, was not unlike many Americans. “I was standing in front of the statue of Gallatin and realised that, despite my Swiss roots, I did not know a lot of details about his life,” the former banker told swissinfo.ch.
When Dungan noticed that 2011 would be the 250th anniversary of Gallatin’s birth, the idea for a biography was born. His project received support from the Swiss foreign ministry and the book is now on the market.

With its more than 200 pages, the book takes you on a journey through Gallatin’s life, including extracts from letters he wrote and received.

Abraham Alfonse Albert Gallatin was born on January 29, 1761 as the second child of a long-established Geneva family. His father, a watch merchant, died in 1765 and Albert was brought up by a relative.

War of Independence

Educated at the Geneva Academy with studies in the humanities and science, Gallatin made his way across the Atlantic in 1780 at a time when the American War of Independence was being fought.

He spent his first years in Boston as a trader and later became a French teacher at Harvard. Three years after that he moved, buying land in Pennsylvania in 1786.

It was about that time that Gallatin’s political career began in what were important years in the history of the United States. In 1789 George Washington was elected as the first president. He appointed as Secretary of the Treasury Alexander Hamilton, who laid the foundation for the finance system of the young country.

Gallatin was elected to represent Pennsylvania in the US Senate in 1793 but was removed from office a year later, after his opponents protested that he had fewer than the required years of citizenship.

Leading light

Two years later he was elected again, this time to the House of Representatives. He rapidly rose to become a leading light in Thomas Jefferson’s party, which was a forerunner of today’s Democrats.

Gallatin quickly became an experienced authority on state finances. He and his party were critical of the centralistic policies of Hamilton.

Jefferson became president in 1800 and he appointed Gallatin Treasury Secretary a year later. Once in office and much to the surprise of many he did not simply throw out the finance system of Hamilton, who had become a personal enemy.

He retained its main features and adapted other areas in the interests of his party. In particular he aimed for the reduction of the country’s debts and for tax transparency.

In the early years of his time in office, Gallatin managed to halve the debt mountain, a factor which helped the young United States to be regarded with trust by the finance markets.

Buy Louisiana

It was also Gallatin who managed to put together the means to buy Louisiana for $15 million (SFr14.83 million) from France in 1803. War between Britain and the US broke out on 1812 and he stepped down two years later.

A new chapter in Gallatin’s political career began after that and he represented the US skillfully in negotiations to end the war with Britain. The Treaty of Ghent was signed in December 1814.

“Without a doubt, Gallatin’s most important accomplishment was the negotiation of the Treaty of Ghent,” Dungan said. The peace agreement established the US as a regional power.

“With this treaty Gallatin gave America its genuine independence; genuine independence in the sense that for the rest of the 19th century, the British Empire was still the biggest thing on the face of the earth, but in fact, the United States did not have to worry any longer about interference from the British Empire.

“For the successful negotiations of the Treaty of Ghent it was absolutely indispensable that Gallatin was European,” he said.

“At the same time, it was also indispensable that he was somebody who had the experience he had, the experience of living in the United States. So this dual culturalism, his transatlantic personality were quite essential for his success.”

Diplomat

After the peace negotiations Gallatin was ambassador to France until 1823 and in 1826 became a diplomat in London.

After his civil service, he moved in 1830 to New York. He was one of the founders of New York University and the Gallatin School of Individualized Study remains to this day.

He led the National Bank of New York until 1838, afterwards devoting his time to economic and financial issues as well as ethnographical research. He died in New York on August 12, 1849, aged 88 and is buried in the cemetery of Trinity Church, which is near Wall Street.

That Gallatin and his outstanding achievements have fallen into oblivion in the United States can be partly explained by the fact that he remained a foreigner, who never completely fitted in with his new home country.

Dungan puts it this way: “… he remained what he was the day he left home: a son of Geneva.”

The author hopes that his new biography will make the “forgotten Swiss founding father” better known. Today’s US could learn a few lessons from Gallatin’s achievements.

Another Swiss author of a book about Gallatin, former Swiss diplomat Benedikt von Tscharner, has welcomed Dungan’s work but says there is scope for further studies on Gallatin.

Von Tscharner would also like to take advantage of the anniversary to try to improve Swiss-American relations.

“[Relations] have suffered several upsets recently: but they are few if you think of everything that unites the two countries, the Sister Republics,” he commented.

Gallatin Year

For the 250th anniversary of the birth of Albert Gallatin, Switzerland has launched a Gallatin250 Project.

Part of the project was the new biography written by Nicholas Dungan entitled Albert Gallatin: America’s Swiss Founding Father.

The book was published in September by the New York University Press. The author will, as part of the project, make a nationwide book tour.

It is available at present only in English but the author hopes he can find the necessary finance to publish a French version.

The Swiss embassy and Swiss consulates plan Gallatin250 Roundtables, a series of public discussions across the US addressing the topic of public debt and fiscal responsibility.

Apart from looking at Gallatin’s legacy, current topics such as public debt and challenges facing today’s world of growing debt mountains will be discussed. One of the topics is Switzerland’s debt brake system.

The budget for the Gallatin year is $230,000 (SFr229.241) which has been provided by public money and private sponsors. The Swiss foreign ministry contributed $145,000.

Nicholas Dungan

The author of the Gallatin biography is a former investment banker. He has studied transatlantic issues for years and was once president of the French American Foundation.

Dungan has Swiss roots. Six of his eight great-grandparents were born in Europe – two in canton Glarus, two in the Scottish city of Glasgow, two in the Italian port of Genoa and the remaining two in Virginia.

The parents of his mother’s father came from Thon, a hamlet between Schwanden and Schwändi in canton Glarus. Their family names were Kindlimann and Blumer. Dungan still maintains contact with his Kindlimann relatives in Thon.

The European connection was always a talking point in the family. History, international relations and finance always interested him, he says, three areas that link him with Gallatin.

(Translated from German and French by Robert Brookes)